Tracking Error (3 Years)

Other Literature

Rising equity markets quickly closed many opportunities in April. We are now determining how to balance the portfolio with companies benefitting from the ongoing crisis, secular growers with short-term, pandemic-related headwinds that have recovered, and stocks that are severely affected by the pandemic and are out of favour. We think it has become much more important to have insights into product stories and industry changes, and this is where we are spending much of our time.

David Eiswert is a portfolio manager in the U.S. Equity Division of T. Rowe Price. He is the portfolio manager for the Global Focused Growth Equity Strategy, a role he has held since October 1, 2012. Prior to his current role, Mr. Eiswert was the portfolio manager for the Global Technology Strategy from October 2008 until May 2012. He was a technology analyst from 2003 until 2012. Mr. Eiswert is a vice president of T. Rowe Price Group, Inc.

Strategy

Manager's Outlook

We entered the year with global growth troughing and expectations of modest growth throughout 2020. Specifically, the deceleration from the 2018 U.S. tax cuts and the U.S.-China trade war were creating a "goldilocks" environment for equities, backed by low rates and high multiples as markets anticipated earnings acceleration throughout 2020.

�

The coronavirus began to affect the markets in late December and exploded during the January and February time frame as it rapidly spread from its epicenter in Wuhan in the Hubei province of China and morphed into what the World Health Organization labeled a global pandemic. The uncertainty this created was further amplified by the pullback in oil prices triggered by a breakdown in talks between OPEC and Russia. This prompted Saudi Arabia to slash its official selling prices to significantly below-market levels and announce plans to ramp up its oil output, which brought further uncertainty to markets.

�

The freezing of economic activity is too powerful for the global economy to withstand without a significant impact, and we believe the world will enter a recession in the next one to two quarters. However, governments and policymakers have been responding in tangible ways to help the economy, and we expect testing and treatment for the virus to improve and accelerate and for U.S. infection rates to peak in the next couple of months, which should help us get to the "stop getting worse" phase (the peak of the crisis) as these factors align.

�

We have followed this tragic and evolving pandemic closely from its early stages in China's Hubei province, analyzing its implications for regional economies, economic sectors, and individual companies. During periods of crisis, we think quality and balance sheet strength are extremely important and are very focused on those dimensions along with our insights about change and improvement as we move past the worst of the coronavirus impact. We are encouraging our research team to use their imagination and consider extreme outcomes.�We can envision in a year's time that interest rates will be higher (not a lot higher, but higher) and that we will see earnings acceleration and multiple expansion from still low rates and lower risk. We want to own the companies that will come out the other side of the crisis in a stronger position.

�

Although volatility and crises may cause near-term panic, it is important to look beyond the immediate disruption we are experiencing and keep a long-term perspective. While being respectful of risk control, both our experience and investment framework tell us that if we focus on great assets that we believe are on the right side of change, we have the potential to reap rewards for our clients over the long term.

Investment Objective

To increase the value of its shares, over the long term, through growth in the value of its investments. The fund invests mainly in a diversified portfolio of stocks that have the potential for above average and sustainable rates of earnings growth. The companies may be anywhere in the world, including emerging markets.

Macroeconomic and local market factors are integrated in stock selection decisions.

Valuation appeal is measured against local market and broad sector opportunity set.

Broad range of stocks across all capitalizations, incorporating developed and emerging markets.

Portfolio Construction

Number of holdings: typically 60-80 stocks

Individual positions: Typically 0.5%-5.0%

Emerging markets exposure: +/-15% of benchmark

Broad sector ranges: +/-15% of benchmark

Country ranges: +/-10% of benchmark (U.S.A. is +/-20%)

Currency hedging: Currency views incorporated in stock selection

Cash target range: Typically less than 5%, Maximum 10%

Expected tracking error: 400 to 800 basis points

Performance (Class A | EUR)

Annualised Performance

Calculated:

1 YR

3 YRAnnualised

5 YRAnnualised

Since InceptionAnnualised

Fund %

8.59%

11.94%

N/A

16.06%

Indicative Benchmark
%

-2.75%

4.26%

N/A

7.89%

Excess Return %

11.34%

7.68%

N/A

8.17%

Inception Date 30-Jun-2016

Indicative Benchmark: MSCI All Country World Index Net

Data as of 30-Apr-2020

Performance figures calculated in EUR

30-Apr-2020

1 YR

3 YRAnnualised

5 YRAnnualised

Since InceptionAnnualised

Fund %

-1.79%

7.24%

N/A

12.16%

Indicative Benchmark
%

-9.18%

0.64%

N/A

5.12%

Excess Return %

7.39%

6.60%

N/A

7.04%

Inception Date 30-Jun-2016

Indicative Benchmark: MSCI All Country World Index Net

Data as of 31-Mar-2020

Performance figures calculated in EUR

Recent Performance

Month to DateData as of 05-Jun-2020

Quarter to DateData as of 05-Jun-2020

Year to DateData as of 05-Jun-2020

1 MonthData as of 30-Apr-2020

3 MonthsData as of 30-Apr-2020

Fund %

2.83%

25.36%

8.44%

15.08%

-4.01%

Indicative Benchmark %

4.06%

18.58%

-4.61%

10.91%

-10.93%

Excess Return %

-1.23%

6.78%

13.05%

4.17%

6.92%

Inception Date 30-Jun-2016

Indicative Benchmark:
MSCI All Country World Index Net

Indicative Benchmark:
MSCI All Country World Index Net

Performance figures calculated in EUR

Past performance is not a reliable indicator of future performance. Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures.

Where the base currency of the fund differs from the share class currency, exchange rate movements may affect returns.

Index returns shown with reinvestment of dividends after the deduction of withholding taxes.

Effective 1 July 2018, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly.

Global equities rebounded following several months of losses as slowing coronavirus infection rates in a number of global hot spots and massive monetary and fiscal stimulus efforts helped support investor optimism. Within the portfolio, our holdings in the information technology (IT) sector, coupled with an overweight position, contributed the most to relative returns. Canadian e-commerce platform Shopify rose amid strong e-commerce data, with robust order growth in the company’s end markets as consumers shifted spending habits online in the wake of coronavirus social distancing measures and brick and mortar retailer shutdowns. We believe Shopify represents a compelling structural growth opportunity driven by its best-in-class cloud-based software platform that allows merchants to sell their products across many “storefronts.” Conversely, our lack of exposure to the energy sector hurt relative performance. We previously had a subdued outlook on the sector given the global oversupply of oil driven by the disruptive impact from U.S. shale production. The coronavirus-led global economic slowdown further exacerbates the near- and intermediate-term issues facing the sector, in our view. As a result, we ended the quarter with no exposure to the energy sector.

Top Purchase

UnitedHealth Group (N)

Top Sale

Tencent Holdings (E)

Despite the extraordinary circumstances of the novel coronavirus pandemic and accompanying market volatility, we continued our focus on mainly building the portfolio from the bottom up. In early February as the crisis began to unfold in Europe and the U.S., we raised cash by selling names with balance sheet concerns and also reduced our stock-level exposure to interest rate sensitive names. We are using our resources and investment framework to continue investing in quality companies where we have an insight about improving economic returns in the future and where valuations aren't excessive.

�

Sector-wise, our allocations to health care and information technology increased, as the market sell-off created pockets of opportunity in areas that we thought were previously too expensive to invest in. Our exposure to communication services decreased. Regionally, our allocation to North America increased, while exposure to Pacific ex-Japan decreased.

Information Technology

We have high conviction in the technology sector, as this is an area where rapid market share shifts mean growth companies are plentiful regardless of the broader macroeconomic environment. Despite the near-term uncertainty and volatility created by the coronavirus outbreak, the powerful long-run trends that we believe will drive value creation in the technology sector should remain in play. Aftereffects from the virus outbreak could also result in lasting behavioral changes, with more people working remotely and payment methods skewing more digitally. As a result, software and electronic payments are areas of focus for our sector exposure, but we also remain positioned to benefit from increasing artificial intelligence (AI) adoption as well as the growing technology consumption in emerging markets, particularly in Asia. We also have a sizable exposure to semiconductor stocks that we anticipate should benefit from content growth in automotive and industrial end markets as well as investment in data centers and artificial intelligence.

Lam Research is a high-quality, semiconductor-adjacent name that produces semiconductor manufacturing equipment, and the recent market volatility allowed us to pick up the name at a compelling valuation. We remain bullish on semiconductor names as we think the industry will be relatively insulated from the current crisis environment and should still benefit from powerful trends over the next one to two years due to accelerating DRAM and NAND demand; higher capital intensity in logic, foundry, and memory; and broader 5G rollout.

We started a position in Taiwan Semiconductor Manufacturing (TSMC), the leading-edge semiconductor chip foundry. We think the semiconductor industry in general will be relatively insulated from adverse effects of the global coronavirus pandemic. TSMC is one of the most well positioned in the industry for strong growth as demand for chips accelerates due to their increased use in AI, automobiles, and the internet of things. The stock pulled back during recent market volatility, making valuation more compelling.

We eliminated our position in Applied Materials early in March on relative strength. We still think the company is high quality and well positioned to benefit as Moore's Law continues to slow and innovation is driven by materials innovations, but we chose to reallocate funds to names in which we had higher conviction.

Health Care

Health care remains a fertile area for growth potential and accelerating technological discovery. One of our largest bets in the portfolio is in health care equipment and supplies, which are typically defensive in an election year given the uncertainty around regulation. The group also has powerful secular drivers such as the ongoing shifts to biologics and robotic surgery as tailwinds. We have less exposure to the biopharma space due to possible regulatory change in the form of drug pricing reform, with the names we do own having relatively unique platforms. More recently, we started building our exposure to U.S. managed care companies as the tail risk around "Medicare for All" has greatly receded. The managed care industry is also likely to realize some benefit from the coronavirus outbreak that could bleed into 2021 as the industry reprices its business.

We started positions in U.S. managed care providers Humana and UnitedHeath Group. With sizable Medicare and Medicaid programs and other diversified businesses, we think both companies are well positioned to benefit in a range of scenarios. Furthermore, it has become increasingly unlikely that the early 2020 election rhetoric surrounding a Medicare for All plan will play out, which would be a tailwind for the firms. Both companies' stock prices slid over the quarter, creating attractive entry prices.

We exited our position in Japanese pharmaceutical firm Chugai Pharmaceutical. The stock held up well during the recent market volatility, and we chose to reallocate funds to names with greater upside potential.

Consumer Discretionary

The consumer discretionary sector has become increasingly challenged as market disruption, driven in part by rapid changes in consumer behavior and e-commerce, has led to a more dramatic demarcation between winners and losers. Given the polarized structure of the sector, our focus is on high-quality names that we believe are on the right side of change and have dominant market positions. We find internet-based media and select retailing companies particularly attractive, but most of our holdings are driven by product-specific stories.

We initiated a position in TAL Education, one of the largest K-12 after-school tutoring companies in China. We think TAL is a high-quality business with significant free cash flow that stands to gain market share in a highly fragmented business.

We moved on from our position in athletic footwear and apparel brand Nike. The stock has held up well amid the recent market sell-off, driven by better-than-expected earnings results. While we still like the company, we chose to reallocate funds to names with greater upside potential.

Communication Services

Amid the changing media, entertainment, and communications landscape, certain sector names benefit from strong user engagement and/or subscriber growth. We believe that the lasting behavioral effects from the coronavirus outbreak could accelerate the long-term trend of streaming video services taking share from traditional television and exacerbate the ongoing shift toward digital advertising. We continue to see limited opportunities for strong growth in legacy telecommunications companies, so we remain focused on highly innovative, secular growers within the entertainment and internet services spaces that we believe�are on the right side of change and benefiting from accelerating popularity of digital media.

We eliminated our position in China's dominant online social platform Tencent Holdings. The stock has held up extremely well in a challenging market environment, so we chose to exit our position and reallocate funds to names with greater upside potential and more compelling valuations.

Largest Underweight

Consumer Staples

We have high conviction in the IT sector. Despite the near-term uncertainty and volatility created by the coronavirus outbreak, the powerful long-term trends that we believe will drive value creation in the technology sector remain in play. Meanwhile, the aftereffects from the virus outbreak could also result in lasting behavioural changes, with more people working remotely and payment methods skewing more digitally. As a result, software and electronic payments are areas of focus within our IT sector exposure. We believe we remain positioned to benefit from increasing AI adoption as well as the growing technology consumption in emerging markets, particularly in Asia. We also have a sizable exposure to semiconductor stocks.

Largest Underweight

Canadian dollar

Team
(As of 21-May-2020)

David Eiswert is a portfolio manager in the U.S. Equity Division of T. Rowe Price. He is the portfolio manager for the Global Focused Growth Equity Strategy, a role he has held since October 1, 2012. Prior to his current role, Mr. Eiswert was the portfolio manager for the Global Technology Strategy from October 2008 until May 2012. He was a technology analyst from 2003 until 2012. Mr. Eiswert is a vice president of T. Rowe Price Group, Inc.

Mr. Eiswert has 19 years of investment experience, 16 of which have been with T. Rowe Price. Prior to joining the firm in 2003, he was an analyst at Mellon Growth Advisors and Fidelity Management and Research. He also worked as a consultant in the communications industry.

Mr. Eiswert earned a B.A., summa cum laude, in economics and political science from St. Mary's College of Maryland and an M.A. in economics from the University of Maryland, College Park. He also has earned the Chartered Financial Analyst designation.

Josh Nelson is a director of research in the U.S. Equity Division of T. Rowe Price. Previously, he was an associate portfolio manager for the Global Focused Growth Equity Strategy. He is an Investment Advisory Committee member of the Global Stock Strategy. He also serves on the Equity Steering Committee. Mr. Nelson is a vice president of T. Rowe Price Group, Inc.

Mr. Nelson has 17 years of investment experience, 12 of which have been with T. Rowe Price. He served as a summer intern with T. Rowe Price in 2006, covering agricultural commodities and ethanol companies. Prior to joining the firm in 2007, he was an investment banker for Citigroup Global Markets, Inc.

Mr. Nelson earned a B.S., with honors, in industrial systems and engineering from the University of Florida. He also earned an M.B.A., with honors, in finance from the University of Pennsylvania, The Wharton School.

Kurt Umbarger is the regional head of the Equity Investment Specialist Group of T. Rowe Price. Previously, he was a global equity portfolio specialist in the International Equity Division. He is a vice president of T. Rowe Price Group, Inc., and T. Rowe Price International Ltd.

Mr. Umbarger has 26 years of investment experience, all of which have been at T. Rowe Price. He joined the firm in 1992 and has been a portfolio specialist since 2001. Prior to joining the global equity team in 2005, Mr. Umbarger worked with the international and emerging market equity teams. As a portfolio specialist, he has traveled the world, working closely with institutional clients, consultants, and prospects.

Mr. Umbarger earned a B.S. in finance from Towson University and an M.S.F. in finance from Loyola University Maryland. He also has earned the Chartered Financial Analyst designation and is a Series 6, 7, 63, and 65 registered representative.

Laurence Taylor is a portfolio specialist in the Equity Division at T. Rowe Price, representing the firm's global equity strategies to institutional clients, consultants and prospects. Mr. Taylor is a vice president of T. Rowe Price Group, Inc. and T. Rowe Price International Ltd.

Mr. Taylor has 19 years of investment experience, 10 of which have been with T. Rowe Price. Prior to joining the firm in 2008, Mr. Taylor was a quantitative portfolio manager at AXA Rosenberg, with responsibility for European institutional clients, and began his career at Hewitt Associates in the UK investment practice. At Hewitt, Mr. Taylor provided investment advice to European institutions as a client-facing consultant before specializing in the research and selection of global and regional equity managers in the manager research team.

Mr. Taylor obtained his B.A., with honours, from Greenwich University and has earned the Chartered Financial Analyst designation.

Jennifer O'Hara Martin is a global equity portfolio specialist in the U.S. Equity Division of T. Rowe Price. She is a member of the Global Growth Equity, Global Focused Growth Equity, Global Technology Equity, Communications & Technology Equity, Science & Technology Equity, and US Structured Research Equity Strategy teams. Ms. Martin is a vice president of T. Rowe Price Group, Inc.

Ms. Martin has 23 years of investment experience, 14 of which have been at T. Rowe Price. She joined the firm in 2005 as an equity research analyst covering food retailing and discount stores and had portfolio management responsibilities for the firm's US Structured Research Equity Strategy. Prior to joining the firm, she was an equity research analyst at Northern Trust, following telecommunications and business services companies. Ms. Martin was also employed by Merrill Lynch, where she was an investment banking analyst.

Ms. Martin earned a B.S. in agricultural economics from the University of Illinois at Urbana-Champaign and an M.B.A. from Northwestern University, Kellogg School of Management. She presently serves on the Board of Trustees of the Baltimore Museum of Art and as a committee member for the Northwestern University, Kellogg School of Management, Asset Management Practicum.

Years atT. Rowe Price

15

Years investmentexperience

24

Fee Schedule

Share Class

Minimum Initial Investment and Holding Amount (USD)

Minimum Subsequent Investment (USD)

Minimum Redemption Amount (USD)

Sales Charge (up to)

Investment Management Fee (up to)

Ongoing Charges

Class A

$1,000

$100

$100

5.00%

160 basis points

1.72%

Class I

$2,500,000

$100,000

$0

0.00%

75 basis points

0.80%

Class Q

$1,000

$100

$100

0.00%

75 basis points

0.88%

Please note that the Ongoing Charges figure is inclusive of the Investment Management Fee and is charged per annum.

Index returns shown with reinvestment of dividends after the deduction of withholding taxes.

Effective 1 July 2018, the "net" version of the indicative benchmark replaced the "gross" version of the indicative benchmark. The "net" version of the indicative benchmark assumes the reinvestment of dividends after the deduction of withholding taxes applicable to the country where the dividend is paid; as such, the returns of the new benchmark are more representative of the returns experienced by investors in foreign issuers. Historical benchmark performance has been restated accordingly.

Lam Research is a high-quality, semiconductor-adjacent name that produces semiconductor manufacturing equipment, and the recent market volatility allowed us to pick up the name at a compelling valuation. We remain bullish on semiconductor names as we think the industry will be relatively insulated from the current crisis environment and should still benefit from powerful trends over the next one to two years due to accelerating DRAM and NAND demand; higher capital intensity in logic, foundry, and memory; and broader 5G rollout.

We started a position in Taiwan Semiconductor Manufacturing (TSMC), the leading-edge semiconductor chip foundry. We think the semiconductor industry in general will be relatively insulated from adverse effects of the global coronavirus pandemic. TSMC is one of the most well positioned in the industry for strong growth as demand for chips accelerates due to their increased use in AI, automobiles, and the internet of things. The stock pulled back during recent market volatility, making valuation more compelling.

We eliminated our position in Applied Materials early in March on relative strength. We still think the company is high quality and well positioned to benefit as Moore's Law continues to slow and innovation is driven by materials innovations, but we chose to reallocate funds to names in which we had higher conviction.

We started positions in U.S. managed care providers Humana and UnitedHeath Group. With sizable Medicare and Medicaid programs and other diversified businesses, we think both companies are well positioned to benefit in a range of scenarios. Furthermore, it has become increasingly unlikely that the early 2020 election rhetoric surrounding a Medicare for All plan will play out, which would be a tailwind for the firms. Both companies' stock prices slid over the quarter, creating attractive entry prices.

We exited our position in Japanese pharmaceutical firm Chugai Pharmaceutical. The stock held up well during the recent market volatility, and we chose to reallocate funds to names with greater upside potential.

We initiated a position in TAL Education, one of the largest K-12 after-school tutoring companies in China. We think TAL is a high-quality business with significant free cash flow that stands to gain market share in a highly fragmented business.

We moved on from our position in athletic footwear and apparel brand Nike. The stock has held up well amid the recent market sell-off, driven by better-than-expected earnings results. While we still like the company, we chose to reallocate funds to names with greater upside potential.

We eliminated our position in China's dominant online social platform Tencent Holdings. The stock has held up extremely well in a challenging market environment, so we chose to exit our position and reallocate funds to names with greater upside potential and more compelling valuations.

Atlassian is an enterprise software company that provides both on-premises and cloud-based collaboration and workflow software and services. The stock produced rare positive returns over the period, driven by the rapid acceleration of online workforce and collaboration. The company also reported very strong quarterly results in January, with robust billings and revenue growth amid increased customer adoption. We think Atlassian is a well-managed, secularly advantaged software company with a disruptive business model that has a long and durable growth runway.

Shares of London Stock Exchange traded down but held up much better than the broader financials sector. As an exchange, the company stands to benefit from increased volatility and, unlike most other financial names, is less sensitive to interest rates. We think London Stock Exchange has a number of compelling growth drivers, including over-the-counter clearing growth and the active-to-passive trend in investing given the firm's ownership of the FTSE/Russell indexes. We also believe that the pending acquisition of financial market data provider Refinitiv will be transformational and provide meaningful revenue, cost, and financial synergies that are underappreciated by the market.

Shares of Japanese cosmetics manufacturer Shiseido fell on concerns that the firm's sizable travel and tourism business could be vulnerable to effects from the coronavirus outbreak. With the risk/reward less favorable, we chose to exit our position in favor of names where we have higher conviction.

Shares of airplane manufacturer Airbus tumbled as travel restrictions due to the global coronavirus outbreak were expected to significantly affect profitability and demand within the airline industry. Nevertheless, we are confident that commercial aerospace will remain a structural growth market, and we believe volumes coming out of the crisis should improve given the ultimate need and desire for air travel. We continue to like Airbus over the long term for its duopoly position, large backlog of orders, and significant recurring revenue streams that provide both stability and growth.

Numbers may not add to 100% due to rounding; all numbers are percentages.

Analysis represents the total performance of the portfolio as calculated by the FactSet attribution model and is inclusive of other assets that that will not receive a classification assignment in the detailed structure shown. Returns will not match official T. Rowe Price performance because FactSet uses different exchange rate sources and does not capture intra-day trading. Performance for each security is obtained in the local currency and, if necessary, is converted using an exchange rate determined by an independent third party. Figures are shown with gross dividends reinvested.

Despite the extraordinary circumstances of the novel coronavirus pandemic and accompanying market volatility, we continued our focus on mainly building the portfolio from the bottom up. In early February as the crisis began to unfold in Europe and the U.S., we raised cash by selling names with balance sheet concerns and also reduced our stock-level exposure to interest rate sensitive names. We are using our resources and investment framework to continue investing in quality companies where we have an insight about improving economic returns in the future and where valuations aren't excessive.

�

Sector-wise, our allocations to health care and information technology increased, as the market sell-off created pockets of opportunity in areas that we thought were previously too expensive to invest in. Our exposure to communication services decreased. Regionally, our allocation to North America increased, while exposure to Pacific ex-Japan decreased.

Information Technology

We have high conviction in the technology sector, as this is an area where rapid market share shifts mean growth companies are plentiful regardless of the broader macroeconomic environment. Despite the near-term uncertainty and volatility created by the coronavirus outbreak, the powerful long-run trends that we believe will drive value creation in the technology sector should remain in play. Aftereffects from the virus outbreak could also result in lasting behavioral changes, with more people working remotely and payment methods skewing more digitally. As a result, software and electronic payments are areas of focus for our sector exposure, but we also remain positioned to benefit from increasing artificial intelligence (AI) adoption as well as the growing technology consumption in emerging markets, particularly in Asia. We also have a sizable exposure to semiconductor stocks that we anticipate should benefit from content growth in automotive and industrial end markets as well as investment in data centers and artificial intelligence.

Lam Research is a high-quality, semiconductor-adjacent name that produces semiconductor manufacturing equipment, and the recent market volatility allowed us to pick up the name at a compelling valuation. We remain bullish on semiconductor names as we think the industry will be relatively insulated from the current crisis environment and should still benefit from powerful trends over the next one to two years due to accelerating DRAM and NAND demand; higher capital intensity in logic, foundry, and memory; and broader 5G rollout.

We started a position in Taiwan Semiconductor Manufacturing (TSMC), the leading-edge semiconductor chip foundry. We think the semiconductor industry in general will be relatively insulated from adverse effects of the global coronavirus pandemic. TSMC is one of the most well positioned in the industry for strong growth as demand for chips accelerates due to their increased use in AI, automobiles, and the internet of things. The stock pulled back during recent market volatility, making valuation more compelling.

We eliminated our position in Applied Materials early in March on relative strength. We still think the company is high quality and well positioned to benefit as Moore's Law continues to slow and innovation is driven by materials innovations, but we chose to reallocate funds to names in which we had higher conviction.

Health Care

Health care remains a fertile area for growth potential and accelerating technological discovery. One of our largest bets in the portfolio is in health care equipment and supplies, which are typically defensive in an election year given the uncertainty around regulation. The group also has powerful secular drivers such as the ongoing shifts to biologics and robotic surgery as tailwinds. We have less exposure to the biopharma space due to possible regulatory change in the form of drug pricing reform, with the names we do own having relatively unique platforms. More recently, we started building our exposure to U.S. managed care companies as the tail risk around "Medicare for All" has greatly receded. The managed care industry is also likely to realize some benefit from the coronavirus outbreak that could bleed into 2021 as the industry reprices its business.

We started positions in U.S. managed care providers Humana and UnitedHeath Group. With sizable Medicare and Medicaid programs and other diversified businesses, we think both companies are well positioned to benefit in a range of scenarios. Furthermore, it has become increasingly unlikely that the early 2020 election rhetoric surrounding a Medicare for All plan will play out, which would be a tailwind for the firms. Both companies' stock prices slid over the quarter, creating attractive entry prices.

We exited our position in Japanese pharmaceutical firm Chugai Pharmaceutical. The stock held up well during the recent market volatility, and we chose to reallocate funds to names with greater upside potential.

Consumer Discretionary

The consumer discretionary sector has become increasingly challenged as market disruption, driven in part by rapid changes in consumer behavior and e-commerce, has led to a more dramatic demarcation between winners and losers. Given the polarized structure of the sector, our focus is on high-quality names that we believe are on the right side of change and have dominant market positions. We find internet-based media and select retailing companies particularly attractive, but most of our holdings are driven by product-specific stories.

We initiated a position in TAL Education, one of the largest K-12 after-school tutoring companies in China. We think TAL is a high-quality business with significant free cash flow that stands to gain market share in a highly fragmented business.

We moved on from our position in athletic footwear and apparel brand Nike. The stock has held up well amid the recent market sell-off, driven by better-than-expected earnings results. While we still like the company, we chose to reallocate funds to names with greater upside potential.

Communication Services

Amid the changing media, entertainment, and communications landscape, certain sector names benefit from strong user engagement and/or subscriber growth. We believe that the lasting behavioral effects from the coronavirus outbreak could accelerate the long-term trend of streaming video services taking share from traditional television and exacerbate the ongoing shift toward digital advertising. We continue to see limited opportunities for strong growth in legacy telecommunications companies, so we remain focused on highly innovative, secular growers within the entertainment and internet services spaces that we believe�are on the right side of change and benefiting from accelerating popularity of digital media.

We eliminated our position in China's dominant online social platform Tencent Holdings. The stock has held up extremely well in a challenging market environment, so we chose to exit our position and reallocate funds to names with greater upside potential and more compelling valuations.

Numbers may not add to 100% due to rounding; all numbers are percentages.

Analysis represents the total performance of the portfolio as calculated by the FactSet attribution model and is inclusive of other assets that that will not receive a classification assignment in the detailed structure shown. Returns will not match official T. Rowe Price performance because FactSet uses different exchange rate sources and does not capture intra-day trading. Performance for each security is obtained in the local currency and, if necessary, is converted using an exchange rate determined by an independent third party. Figures are shown with gross dividends reinvested.

Numbers may not add due to rounding and/or the exclusion of reserves and other assets.

Indicative Benchmark Data Source: MSCI. MSCI and its affiliates and third party sources and providers (collectively, “MSCI”) makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used as a basis for other indices or any securities or financial products. This report is not approved, reviewed, or produced by MSCI. Historical MSCI data and analysis should not be taken as an indication or guarantee of any future performance analysis, forecast or prediction. None of the MSCI data is intended to constitute investment advice or a recommendation to make (or refrain from making) any kind of investment decision and may not be relied on as such.

Past performance is not a reliable indicator of future performance. Source for fund performance: T. Rowe Price. Fund performance is calculated using the official NAV with dividends reinvested, if any. The value of an investment and any income from it can go down as well as up. Investors may get back less than the amount invested. It will be affected by changes in the exchange rate between the base currency of the fund and the subscription currency, if different. Sales charges (up to a maximum of 5% for the A Class), taxes and other locally applied costs have not been deducted and if applicable, they will reduce the performance figures.

Daily performance data is based on the latest available NAV. Performance returns for share classes less than 1 year old (and associated benchmarks) are cumulative rather than annualised.

Please note that no management fees are charged to the S and J share classes. No administration agent fees are charged to the J class. Fee arrangements for the S and J classes are made directly with the investment manager. Please see the prospectus for further information.

The Funds are sub-funds of the T. Rowe Price Funds SICAV, a Luxembourg investment company with variable capital which is registered with Commission de Surveillance du Secteur Financier and which qualifies as an undertaking for collective investment in transferable securities (“UCITS”). Full details of the objectives, investment policies and risks are located in the prospectus which is available with the key investor information documents in English and in an official language of the jurisdictions in which the Funds are registered for public sale, together with the annual and semi-annual reports (together “Fund Documents”). Any decision to invest should be made on the basis of the Fund Documents which are available free of charge from the local representative, local information/paying agent or from authorised distributors and via www.troweprice.com.

Hedged share classes (denoted by 'h') utilise investment techniques to mitigate currency risk between the underlying investment currency(ies) of the fund and the currency of the hedged share class. The costs of doing so will be borne by the share class and there is no guarantee that such hedging will be effective.

Net Asset figure applies to all share classes.

Number of years managing the fund. In the case of co-portfolio management, the longer tenure is displayed.

The specific securities identified and described in this report do not represent all of the securities purchased, sold, or recommended for the sub-fund and no assumptions should be made that the securities identified and discussed were or will be profitable.

A full list of the currently issued Share Classes including Distributing, Hedged, and Accumulating Categories may be obtained, free of charge and upon request, from the registered office of the Company.

Dismiss

Tap to dismiss

Our Mission is Simple.

Help clients around the world achieve their long-term investment goals.

GIPS® Information

T. Rowe Price ("TRP") claims compliance with the Global Investment Performance Standards (GIPS®). TRP has been independently verified for the twenty one- year period ended June 30, 2017 by KPMG LLP. The verification report is available upon request. Verification assesses whether (1) the firm has complied with all the composite construction requirements of the GIPS standards on a firm-wide basis and (2) the firm's policies and procedures are designed to calculate and present performance in compliance with the GIPS standards. Verification does not ensure the accuracy of any specific composite presentation.

TRP is a U.S. investment management firm with various investment advisers registered with the U.S. Securities and Exchange Commission, the U.K. Financial Conduct Authority, and other regulatory bodies in various countries and holds itself out as such to potential clients for GIPS purposes. TRP further defines itself under GIPS as a discretionary investment manager providing services primarily to institutional clients with regard to various mandates, which include U.S, international, and global strategies but excluding the services of the Private Asset Management group.

A complete list and description of all of the Firm's composites and/or a presentation that adheres to the GIPS® standards are available upon request. Additional information regarding the firm's policies and procedures for calculating and reporting performance results is available upon request.

Other Literature

You have successfully subscribed.

Notify me by email when

regular data and commentary is availableexceptional commentary is available

new articles become available

Thank you for your continued interest

Registration incomplete.

Please reference the email we sent you and click the link to confirm. If you don't see an email, please check your spam folder or request another email.